UK Posts

UK’s Draft Strike Prices Announced After Report Warning that the UK May Not Reach its Energy Goals

The UK government recently announced the strike price that large-scale solar projects can receive under its new Contracts for Difference scheme. This new scheme is part of the government’s Electricity Market Reform. The prices depend on the type of power being generated and guarantee that generators are paid a fixed sum or a strike price for the electricity they generate. Large solar generators (>1GW projects) will receive £125 in 2014 and £110 in 2019. However, other sources like hydro and biomass will receive the same amount from the 2014-2019 period.

The government confirmed this capacity mechanism will begin next year for existing generators and investors in new plant biddings through auctions for UK’s electricity demands. Participants that successfully bid will receive a payment in the year they agree to make capacity available. To receive payment, they must provide electricity during stress periods or else, a fine will be paid.

The idea behind the new strike prices is to make the UK energy market more attractive for renewable developers, to promote domestic business, to decarbonize the economy, and to reach the goal of over 30% renewable sources by 2020. Of course, there have been some varying opinions on the draft prices. UK’s Renewable Energy Association believes the draft prices are less than was expected and have omitted too much from biomass. While the trade group, RenewableUK, believes that the draft strike prices are a step forwards towards long-term market function. Maria McCaffery, the chief executive, states that although the prices could be challenging, it will be possible considering the shorter time period and in comparison to the Renewable Obligation Scheme. Investor confidence requires some time as well as the knowledge that government incentives for renewable energy are a long-term commitment.

Yet, most agree that there are still details that must be stamped out to overcome the uncertainty. One of UK’s largest utilities, RWE, adds that a lot of uncertainty remains including the need to receive EU state aid approval and the complexity of proposals.  Investor confidence depends on long-term support and certainty. When the final details are set, the UK will be able to see how UK energy investments change.

The announcement of the strike prices were announced soon after reports that stated there was a significant risk that the UK may not reach its renewable energy goals. The energy regulator, Ofgem, has done its second annual report on UK electricity capacity stating, “without action, risks to electricity supply could increase during the middle of this decade faster than expected.” The Committee on Climate Change has stated that although, the UK has made strong progress towards their 2020 emission targets, the report emphasizes that they must stay on track. New policies such as the strike prices should be developed and implemented to maintain UK’s renewable targets. If this does not happen, the risks and costs of moving to a low-carbon economy will rise. The Energy Bill must be implemented into the statute books as soon as possible. Charlotte Morton, chief executive of the Anaerobic Digestion and Biogas Association adds that the UK needs stronger coordination between relevant government departments that can provide harmonized policies that can support the nation’s carbon and energy targets.

Source: Greenwise Business, Power Engineering International (1), (2), Solar Power Portal

Interview with Project Manager of UK’s National Solar Centre – Jonny Williams

The BRE National Solar Centre (NSC) in the UK opened on April 25th this year as a centre for excellence and knowledge for solar energy in the UK. It aims to drive the UK solar market and solar innovation forwards through industry-led research, data analysis, testing, and training. The NSC will also connect to universities world-wide to further research and future technologies. The NSC can also act as a united voice for the UK industry and connect to international photovoltaic (PV) players. The centre also hopes to develop set standards for large-scale installations that will also compliment UK’s current standards, the Microgeneration Certification Scheme (MCS) supported by the Department of Energy and Climate Change (DECC) and offer due diligence consulting.

Milk the Sun is interviewing Jonny Williams, the project manager of UK’s recently opened National Solar Centre.

Milk the Sun: Mr. Williams, what will be the main goals of the NSC in 2013?

Williams:  To establish the BRE National Solar Centre as the leading knowledge centre for solar PV and solar thermal in the UK.  Also we wish to look at international opportunities and to set up our solar test site.

Milk the Sun: NSC wants to focus on evidence-based information for the people involved in the PV suppl

Johnny Williams (right) states that quality information will support the UK solar industry.

Johnny Williams (right) states that quality information will support the UK solar industry.

y chain. How can this type of information and research benefit the UK solar market?

Williams: The rapid development of the UK solar industry since April 2010 has seen a lot of benefits for the industry but also a number of problems to do with a lack of reliable information.  The provision of good quality information on cost, quality and energy generation for a range of different projects will support the industry to grow, mature and thrive.

Milk the Sun: How will the NSC reach out to international players? How does the NSC plan on contributing research to the international PV market?

Williams: We are actively pursuing a number of international opportunities through BRE’s existing network of contacts and also via UK government departments such as UKTI (UK Trade and Investment).

Milk the Sun: Do you think that UK public opinion on solar energy is dependent on their knowledge of solar energy?  Will research acquired by the NSC be transparent and accessible to the public?

Williams: The public perception of all type of energy generators or energy savers is subject to many different influences, some of which bear little resemblance to science or good quality data.  All BRE National Solar Centre key outputs will be available to the public.

Milk the Sun: What do you expect to see in UK’s future government policies in regards to the solar energy sector?

Williams:  We have been very pleased to see the UK government’s continuing support of the solar industry.  Clearly energy security, UK jobs and low carbon generation are viewed as being key contributions from the UK solar industry.  As such I would expect to see support in the UK to continue, as long as the industry can focus on quality and innovation.

Milk the Sun: What do you predict for the future of UK’s solar PV market, especially with the EU’s tariff on Chinese solar modules?

Williams:  The job for the BRE National Solar Centre is to focus on reliable evidence produced by independent research and testing.   By providing this the industry will continue to develop in the future.

Milk the Sun would like to thank Mr. Williams for a compelling interview and are excited to see how the NSC will change the UK solar industry.

How will UK’s booming solar industry react to EU’s import tariffs on China

It is quite undeniable that the UK has experienced a huge solar boom in the last two years. After its government established the Feed-in Tariffs (FiTs) in 2010, the industry essentially went from nothing to 2.5GW and there is no end in sight. The UK government is striving to reach a goal of 20GW by 2020. Currently, 1.9GW of UK’s installed solar capacity is roof-mounted and 0.6GW of its capacity is from ground-mounted modules or solar farms. The majority of the UK’s solar capacity is located in the South West with over 70 solar farms totaling 290MW. However, the government decreased the FiTs soon after realising the extent of interest from relevant players. Some have even gone to criticise the lowered FiTs as an example of unsustainable state assistance. FiTs are no longer available to large-scale projects, however, they remain quite economically feasible under the Renewable Obligation (RO) scheme, and with lower solar module costs and cheaper panels from China. While the RO has been successful, the Renewable Obligation Certificates (ROCs) were lowered from two to 1.6 in March. Nevertheless, the market may begin to shift for the UK in June as the European Commission is set to impose import tariffs on Chinese solar modules.

UK's solar industry must now deal with EU's import tariffs on Chinese solar modules©stockcam

UK’s solar industry must now deal with EU’s import tariffs on Chinese solar modules©stockcam

In attempts to mitigate what some European solar panel manufacturers have perceived as a take-over by the Chinese industry, the EU will place anti-dumping tariffs of up to 67% on panels from China. China currently exports 21€ billion worth of solar panels to the EU every year, totaling 80% solar panel sales in the EU. Some European solar manufacturers that have filed for bankruptcy have complained that Chinese manufacturers have received unfair assistance from their government such as tax rebates, free land for factories, and other policy support. Regardless of the cheaper prices, some consumers worry that the quality of solar panels coming from China is not on par with European manufacturers. Despite China’s “unfair competition”, hundreds of companies have written to the European Commission, warning of the consequences that will come with the tariffs, making solar less attractive to investors and consumers and the possibility of increasing technology costs.

Ray Noble, one of the principals behind UK’s recently opened national solar centre sees potential in Europe and UK firms downstream of solar panel manufacturing – in installations and development of new technologies. To have a thriving domestic industry is better than none at all and the UK can begin to focus on areas of the industry where they can lead the world. Eventually, technology costs will drop and subsidies may no longer exist, perhaps, solar energy will finally be feasible on its own. The UK should also further investigate the incorporation of energy storage technologies with PV energy which has already been implemented in Germany and Japan. It provides an opportunity for UK engineering firms and a possibility for the UK to have inverters and other support structures produced only within the UK.

Currently, the UK consistently outperforms the predictions made on its industry and investors receive higher returns than is originally expected (up to 15-20% better than computer predictions). It seems like the biggest issue in with UK’s booming solar market is trying to keep up with it.

Source: The Engineer (1), (2)

The Rise of Solar Storage Technologies in the UK

A recent report by IHS Inc. (Colorado, US), a renowned global information company, has stated that photovoltaic (PV) storage systems will be on the rise by 2014. They estimate that there will be a global PV storage market worth $19 billion USD by 2017. Germany is currently leading in storage technologies and beginning May 1st, the nation will offer tariffs for PV storage technologies. This will lower the average 20-year cost of a PV installation with a storage system to 10% less than an installation without storage. The IHS report predicts that many countries including the UK will follow closely behind Germany’s example.

Countries using this technology will eventually drive global installations to 7 GW by 2017. The UK is expected to also use a similar method to Germany’s subsidies to encourage the use of PV storage technologies. Other countries may also adopt a tariff model to increase the use of PV storage which can be used to promote self-consumption of energy and grid stability. Grid stability can already be supplemented through solar PV energy. Using storage systems in connection with residential PV set-ups are still extremely attractive in this market.

Solar storage technologies were also forecasted to grow stronger in larger PV systems as well, especially as solar PV energy continues to place pressure on grid systems. The report predicts that utility-scale storage will increase to over 2 GW by 2017 with Asia and Americas dominating the market.

Source: Solar Power Portal UK


Photovoltaic in the United Kingdom – an overview

Country: United Kingdom (UK)United Kingdom UK Solar PV
Area: 244,820 km2
Population: 61.8 Million
Language: English
Government: Parliamentary Constitutional Monarchy

Electricity Consumption: 341,918 GWh/Year
Electricity Import: 5,234 GWh/year
Percentage Renewable Energy: 5.1%
Percentage Photovoltaic: 0.07%
Installed Photovoltaic Output: 1 GW
Solar Irradiation: 750kWh/m2 to 1,100kWh/m2

Solar PV UK Britain Marketplace

© Katarzyna Chojnacka

Electricity and PV in the United Kingdom

The largest energy sources in the UK are Coal, Gas and Oil, comprising over three quarters of the country’s total energy production. Renewable energy is receiving more and more government support, however, due to the UK’s geographic location photovoltaic plays only a minor role in these developments. Currently only 0.07% of electricity production comes from solar installations.

Policy and Feed-in Tariffs

Since the 1st of April 2010, the United Kingdom provides feed in tariffs for renewable energy. The primary beneficiaries of these tariffs are private households. They receive subsidies when they produce electricity that is not fed back into the grid, but rather used directly at home. Installations over a total capacity of 5MW are not supported.

The original range of the subsidies was between 0.1049 €/kWp and a maximum of 0.5343 €/kWp. The following cutbacks of 2011 were further decreased in September and November 2012, with a current subsidy range of 0.0876 €/kWp to 0.19 €/kWp. The larger the installation, the lower the tariff.

Grid Parity in the United Kingdom

Net parity in the United Kingdom has still not been achieved. Predictions place grid parity in the year 2020.


The United Kingdom must fight to keep the momentum of its renewable energy development going. To this end, this year more money has been freed up. At any rate, discussions are already in progress regarding the establishment of feed in tariffs for renewables. Low acceptance in industry and politics, and well as the difficult geographic situation, do not bode well for PV development. Oft overlooked, however, is the fact that London lies farther south than Berlin – conditions exist for photovoltaic in the southern parts of the UK.

Source: British Photovoltaic Association UK Solar PV Update, November 2012

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